Erste Hungary's H1 net loss widens 42% y/y to EUR 72.7mn.

By bne IntelliNews August 1, 2012
The Hungarian unit of Austrian Erste Bank posted a net loss of EUR 72.7mn in H1 2012, up from a net loss of EUR 51.2mn recorded a year earlier, the parent bank said in a statement. The Hungarian lenders net interest income dropped 7% y/y to EUR 175.9mn and its income from net fee and commission was also down 7.6% y/y to EUR 45.3mn in H1 2012. Losses under other result accounted for EUR 92.9mn in H1 2012, up from EUR 36.5mn a year earlier. On the positive side, the lender managed to cut administrative spending by 19.1% y/y and risk provisions by 31% y/y. The NPL ratio deteriorated to 24.6% at end-June 2012, up from 15.5% at end-June 2011 and 21.1% at end-2011. Erste Hungary has earlier announced a number restructuring measures in response to the deteriorating revenue outlook along with lower lending activity, higher provision-requirements, higher expenses resulting from the bank levy and the early loan repayment scheme and rising risks due to the adverse external environment. The bank has reduced the headcount by 10.9% y/y to a total of 2,598 employees at end-June 2012, while the number of branches in Hungary has been cut by 41 to 143.
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